Moscow surpasses Tokyo as priciest metropolis. Asuncion, on the other hand, is still a big bargain.

By Jeanne Sahadi, CNNMoney.com senior writer

June 26 2006: 10:00 AM EDT

NEW YORK (CNNMoney.com) -- The vodka may be cheap, but according to the latest cost-of-living survey from Mercer Consulting, Moscow now ranks as the world's most expensive city, edging out Tokyo, which held the No. 1 spot for four straight years.

Moscow ranked No. 4 last year, but rose through the ranks for a few reasons, according to Mercer senior consultant Rebecca Powers. The currencies of Tokyo, Osaka and London -- the top 3 cities last year -- fell relative to the dollar, while the Russian ruble remained fairly stable. Plus, Powers added, the price of housing for expatriates in Moscow has risen considerably in the past 12 months.

Top 10 most expensive cities

1.

Moscow

2.

Seoul

3.

Tokyo

4.

Hong Kong

5.

London

6.

Osaka

7.

Geneva

8.

Copenhagen

9.

Zurich

10.

Oslo, New York (tied)

Source: Mercer Consulting

The weakened yen places Tokyo in the No. 3 spot, just behind Seoul, while Osaka fell to No. 6.

London, meanwhile, still makes a pricey showing at No. 5, making it the second most expensive city in Europe behind Moscow. It's followed by Geneva, which ranks No. 7 worldwide.

"For many companies it can now be more expensive to send employees to work in Russia or Korea than places like Japan or Switzerland, which are often perceived to be more costly," Powers said in a statement.

The survey uses New York City, ranked No. 10, as its cost base -- scoring it at 100. Then it compares the prices of more than 200 items, including housing, household goods, food, entertainment and transportation in 144 cities around the globe.

Mercer found that Moscow costs 24 percent more than Gotham, while Asuncion, the perennial last-place finisher, costs about 56 percent less than life in the five boroughs.

In the United States, the most expensive cities are New York, Los Angeles (No.29 worldwide), San Francisco (No. 34) and Chicago (No. 38).

In Latin America, Sao Paulo (also ranked No. 34) and Rio de Janeiro have the highest cost of living, while in in Asia, the most expensive cities are Seoul, Tokyo and Hong Kong (No. 4).

Eastern European cities like Budapest (No. 65) and Prague (No. 50) that don't use the euro dropped in the rankings from last year as local currencies fell against the dollar.

Sydney at No. 19 remains the costliest city in Australasia, far ahead of Melbourne (No. 74) and Brisbane (No. 99).

To give a sense of just what life costs in various cities, Mercer priced out the cost of a two-bedroom unfurnished apartment, a cup of coffee served, a fast food meal and an international paper.

In Moscow, the apartment will run you $3,000, the coffee $5.27, the paper $3.40, and the burger with fries $3.87.

By contrast, Buenos Aires provides a better deal price-wise, to say nothing of warmer temperatures. You can nab the apartment for $999, the coffee for $1.47, the paper for $4.55 and the happy meal for $2.77.